Research On The Influence Of Rural Financial Development On Rural Residents’ Consumption In Henan Province

China is a large agricultural country,"rural,agricultural,farmers" has affected the development of the country from beginning to end.Therefore,in the study of residents’ consumption,if the neglect of rural research will cause serious problems.However,Henan province,a major agricultural province in China,has always focused on the problems of "rural,agricultural,farmers".Although the consumption level in rural areas has been increasing year by year,it still lags far behind that in urban areas.The consumption of rural residents has been suppressed for a long time,and the consumption has great potential.Therefore,how to effectively start the vast rural consumption market in Henan province and promote the improvement of rural residents’ consumption demand will play an immeasurable role in promoting the economic development and economic structure optimization of Henan province and promoting the sustainable stability of its economy and society.Through literature review,this paper finds that most previous scholars believe that rural financial development will significantly promote farmers’ consumption.However,there are also opposite views,that the influence between the two is not obvious,it has time-delay,and even appears to inhibition.Therefore,although scholars have done a lot of research on the relationship between financial development and household consumption,they have not yet formed a completely unified view.Based on this,this paper adopts theoretical analysis and empirical analysis to study the influence of rural financial development and farmers’ consumption expenditure in Henan Province.Based on the theories of rural financial development and consumption,this paper analyzes the influence mechanism of rural financial development on farmers’ consumption,which can be divided into direct and indirect influences.The direct impact is that rural finance brings consumptive credit,which directly increases the use of funds by farmers.The indirect influence is to increase farmers’ income,improve farmers’ consumptive environment and reduce their uncertainty about the future,promote their consumption abilities and tendency,so as to increase consumption.Through the analysis of the development course of rural finance in Henan province,the present situation of rural finance system,the present situation of rural finance development level and the present situation of farmers’ consumption,we find out the existing problems.The problems in financial development are as follows: although the coverage of the scale of rural financial development in Henan province has been improved,the types of financial products are single and the quality of financial services lacks impetus.Rural financial efficiency is low,and more rural funds are used by cities and towns,resulting in capital outflow.Problems in the consumption of rural residents include: although the overall consumption of rural residents has been significantly improved,there is still a large gap between the consumption of rural residents and that of urban residents.The average consumption of per rural residents and the average annual growth rate are far behind those of urban residents.In addition,the proportion of farmers’ developmental consumption in the total consumption is low,the consumption structure is unreasonable,and the overall consumption is restrained.Then,on the basis of theoretical analysis,theoretical hypotheses are put forward.The VAR model is established by using Eviews10.0 software based on the data of rural finance and farmers’ consumption in Henan province from 1990 to 2017.The final results show that the scale of rural financial development in Henan province is positively correlated with the consumption of rural residents in Henan province,that is,the expansion of the scale of rural financial development in Henan province can promote the consumption of rural residents.As for the efficiency of rural financial development in Henan province,it is impossible to judge what kind of impact it has on rural residents’ consumption in a short time,that is,there is no significant difference between the impact and 0.However,in the long run,the efficiency of rural financial development in Henan province has a negative inhibitory effect on the improvement of rural residents’ consumption.On this basis,this paper puts forward policy suggestions: first,expand the scale of rural financial development in Henan province.Second,improve the efficiency of rural financial development in Henan province.Third,we should strengthen the financial support in rural areas from multiple angles,and put forward some suggestions to improve the consumption level of farmers from the perspective of influencing their consumption channels.